Donald Trump Dubbed ‘Billionaires’ Candidate’ by Experts — How Second Presidency Could Impact Stock Market
Written by
Dawn Allcot
Edited by
Daria Uhlig
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Donald Trump secured the New Hampshire primary with 54.3% of the votes, earning 12 delegates over Nikki Haley’s nine. Many people consider this the next step on Trump’s road to the presidency.
Some experts and pundits have dubbed Trump “the billionaires’ candidate.” Wall Street views on Trump have shifted, experts said, as company CEOs and investors come to terms with a Trump nomination as the GOP candidate for the presidency in 2024.
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“Wall Street is basically nonchalant to this election,” Wall Street executive and former Trump communications director Anthony Scaramucci told The Hill.
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Jeffrey Sonnenfeld, a senior associate dean at the Yale School of Management, told CNBC, “I think unless there is some catastrophic crisis like the [Jan. 6, 2021] insurrection, they think of themselves as stewards of other people’s money and they don’t want to take a position that divides their workforce, their investors and their customers.”
Trump and the Stock Market
The stock market soared in 2016 after Trump defeated Democratic candidate Hillary Clinton in the presidential election, CNBC reported. Financial, health and pharmaceutical stocks in particular rallied. Some attributed the gains to the assumption that corporations would face less regulation under Trump than they would have under Clinton.
A Trump win in 2024 could affect the stock market differently, though — or even have little-to-no effect. Most investors believe that the U.S. Federal Reserve policies, corporate earnings and the general economic cycle will affect markets more than the election outcome, Reuters reported.
Trump Tax Breaks for Ultrawealthy
Trump’s Tax Cuts and Jobs Act of 2017 favored corporations and wealthy Americans, reducing the corporate tax rate from 35% to 21%.
Trump had predicted these cuts would lead to raises of $4,000 for many workers and spur business growth, factory openings and a vibrant economy, according to the Center for American Progress.
Instead, business investment declined and wage growth slowed. With the lack of business growth and reinvestment, corporate tax revenue declined, resulting in greater U.S. debt.
Trump previously proposed reducing the federal corporate tax rate further, to 15%, although campaign advisors have said more recently that he’d maintain the rate at 21%. He’s also expected to make individual and estate tax cuts from the 2017 TCJA permanent, according to the Tax Foundation.
Theoretically and historically, what’s good for publicly held corporations should be good for the stock market, but time will tell.
Bottom Line
In the absence of any unforeseeable social or economic disasters, the stock market could continue rallying with a Trump win. But the real determining factors could be interest rates and the general economy.
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